Voluntary environmental regulation in developing countries: Mexico's Clean Industry Program
AbstractBecause conventional command-and-control environmental regulation often performs poorly in developing countries, policymakers are increasingly experimenting with alternatives, including voluntary regulatory programs. Research in industrialized countries suggests that such programs are sometimes ineffective, because they mainly attract relatively clean participants free-riding on unrelated pollution control investments. We use plant-level data on more than 100,000 facilities to analyze the Clean Industry Program, Mexico's flagship voluntary regulatory initiative. We seek to identify the drivers of participation and to determine whether the program improves participants' environmental performance. Using data from the program's first decade, we find that plants recently fined by environmental regulators were more likely to participate, but that after graduating from the program, participants were not fined at a substantially lower rate than nonparticipants. These results suggest that although the Clean Industry Program attracted dirty plants under pressure from regulators, it did not have a large, lasting impact on their environmental performance.
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Bibliographic InfoArticle provided by Elsevier in its journal Journal of Environmental Economics and Management.
Volume (Year): 60 (2010)
Issue (Month): 3 (November)
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Web page: http://www.elsevier.com/locate/inca/622870
Voluntary environmental regulation Duration analysis Propensity score matching Mexico;
Other versions of this item:
- Blackman, Allen & Lahiri, Bidisha & Pizer, William A. & Planter, Marisol Rivera & Piña, Carlos Muñoz, 2010. "Voluntary Environmental Regulation in Developing Countries: Mexico's Clean Industry Program," Discussion Papers dp-07-36-rev, Resources For the Future.
- Q56 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Environment and Development; Environment and Trade; Sustainability; Environmental Accounts and Accounting; Environmental Equity; Population Growth
- Q58 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Environmental Economics: Government Policy
- O13 - Economic Development, Technological Change, and Growth - - Economic Development - - - Agriculture; Natural Resources; Environment; Other Primary Products
- O54 - Economic Development, Technological Change, and Growth - - Economywide Country Studies - - - Latin America; Caribbean
- C41 - Mathematical and Quantitative Methods - - Econometric and Statistical Methods: Special Topics - - - Duration Analysis; Optimal Timing Strategies
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